Global Demand Lifts Basmati Exports By 27% Despite Iran Payment Issues.

India's April-June basmati rice exports have grown from 5.5 lakh tonnes last fiscal to 7 lakh tonnes this fiscal, an increase of 27.3%, according to data from the Agricultural & Processed Food Products Export Development Authority (Apeda). The increase comes despite continuing payment issues with Iran, the country’s largest basmati customer. In the last financial year, Iran and Saudi Arabia together accounted for half of all basmati shipped from India.

Exporters say that payments from Iran have been slow, but global demand for basmati rising at 5% every year has helped, boosting export volumes. Vijay Setia, president, All India Rice Exporters’ Association (AIREA) said average price realisation from basmati exports has increased from $1,085 a tonne last fiscal to $1,131 this fiscal, a rise of $46 per tonne. “Demand has been growing despite hiccups in the payment settlement system in some countries in the West Asia,” Setia told FE.

In 2010-11, India harvested over 4.5 million tonnes of basmati rice, of which 2 million tonne worth R12,000 crore were exported. Around half of all exports went to Iran and Saudi Arabia. However, 2009-10 had seen only 4 million tonnes of basmati output, thanks to drought-like conditions which had prevailed in many rice-growing areas then.

“Last year, there were excess stocks in the pipeline and a payment issue with Iran. This year, exports have picked up,”said Ashwani Arora, joint managing director with LT Foods, which exports Dawat basmati rice.

As per Apeda data, basmati exports in 2009-10 rose almost 35% to 2.2 million tonne from 1.6 million tonne in 2008-09. In value terms, exports crossed R12,000 crore compared with R9,476 crore in 2008-09.

With rice stocks booming, an empowered group of ministers headed by finance minister Pranab Mukherjee on Monday allowed export of one million tonne of non-basmati rice. Non-basmati rice exports were banned in April 2008 in the wake of raging food inflation. Before the ban, India's annual non-basmati rice exports were around R8,000 crore.In February this year, the government allowed exports of Ponni, Rosematta and Sona Masuri varieties of premium non-basmati rice grown in Tamil Nadu, Kerala, Andhra Pradesh and Karnataka.

Source : financialexpress.com